One More Comment on Trade Shows, A Perspective On the “Outdoor” Industry, and Articles on Retail.

Trade Shows

Trade shows were created to bring buyers and sellers, that is brands and retailers, together to do business.  Everything else that goes on at trade shows, beneficial as it may be, has been secondary to that goal.

But there are fewer smaller retailers and fewer retailers overall.  The consensus is that the number will continue to drop (see the articles referenced at the end of this).  Larger retailers have less reason to attend, as their most important suppliers reach them outside of the trade show venue.  Meanwhile, changes in logistics, technology and the supply chain have introduced some chaos into the formerly more or less reliable buy sell cycle around which we scheduled shows.

To me, this means there’s less value in attending traditional shows.  The return on investment is harder to justify for buyers and sellers.  Meanwhile, brands and retailers are generally competitors at a greater or lesser level.  Are they perhaps a bit more cautious in how they work together and share?

What’s the result?  Neither buyers or sellers need to send as many people to trade show for as long.  Smaller booths, shorter shows, fewer attendees.  Consolidation of shows.  I haven’t had any retailer or brand tell me that putting OR together with SIA is a bad idea.  If you are one who thinks it is, I’d love to hear why.  Ultimately, I expect fewer shows though, as is always the case in consolidation, everybody will struggle to survive hoping it’s the other guy who goes away.

There will be more focus on consumers.  It’s the best way to cover overhead.  There will be some smaller, focused, curated shows.  Interestingly, it feels like there will be room for big shows and for small shows.  As usual, the ones caught in the middle will have the most trouble.  I wonder if there might somehow be some local, “popup” shows.

The fundamental reason trade shows were created has declined in importance.  A lot.  That’s the thought I want you to have top of mind as you consider the show landscape.  Given the change, how has what you get out of the shows changed?

The Outdoor Industry

Boardsport Source is a good magazine.  It’s generally thoughtful, and helps me know what’s going on in Europe.  I was looking at “The Great Outdoors SS18 Retail Buyer’s Guide” in the July issue.  I can’t find the picture on line, but in the Camping Gear section of the magazine, there was a picture of a campfire.  Nothing unusual about the fire.  But it was on some kind of curved metal grate or holder just for the fire.  Stuck into the ground next to it was a black metal pole with a couple of adjustable rods coming off it.

One of those rods held a large metal pot with a lid that was cooking something over the fire.  The other, higher up on the pole and not over the fire, held a tray with what appeared to be a coffee pot and mug as well as a plate with food on it.

So, I used to do some serious back packing.  A week to two weeks out in the back country over mountain passes carrying everything we needed on our backs.  Sometimes we caught some fish.  My “friends” let me clean them so I would be the one the bear was attracted to.

When you do that kind of camping, you are always concerned with the weight of your pack.  First, you are concerned that it is too heavy.  Later in the hike, as the food goes away and if the fish aren’t biting, you worry it’s too light.

I want you to know that none the equipment I described around the fire ever made it into any back-country camper’s pack.  Not for a minute did we consider trying, as the article says, to “bring your kitchen outdoors.”  Comfort was measured ounce by ounce, as you strove obsessively to minimize the weight of what you had to carry.  Or to put it in somebody else’s pack.

I’m not against drive up camping and having your comforts.  Certainly, rigorous backpacking isn’t for everybody.  But the picture and description of the gear made me think about the “outdoor” target market.  For the reasons I’ve described this kind of equipment specifically excludes serious backcountry campers.  Unless they have it flown in by helicopter I suppose.

The elite athletes in skateboarding, snowboarding and surfing always used more or less the same equipment the typical participant used, though of course they did things with it that most of us were never going to try.

Suddenly, in this particular case at least, that doesn’t seem to be the case.  I don’t quite know what to make of it.  Is the “outdoor” market defined as anybody who’s not “indoors?”  Is there a “core” to be connected to?  Does that matter?  Do the customers, whoever they are, care about the product or do they just take product for granted and focus on an associated experience?

What does it mean to be a brand in the “outdoor” market and how do you identify your customers?  If you think it’s everybody who’s not indoors, it’s nobody.  I guess it helps a little if you say, “active outdoors,” but it hardly solves the problem.

Perhaps, as we’ve become more and dependent on the public and private equity markets for financing, you have to define your brand’s potential in a way that at least appears to place it in a market where there’s enough growth opportunity- even if that’s destructive of the brand in the longer term.

Read These

This first article, “Over Storing America,” gives some insight into how retail got to be so overbuilt that perhaps you hadn’t thought about.

The second, called “Retail Shift,” was sent to me by a friend.  Thanks friend.  The article says:

“the market make-up has been shifting and continues to shift from a fairly homogeneous composition of primarily baby boomers into a significantly splintered compilation consisting of Gen X, milliennials, Gen Z and the boomers. Multiple sub-segments exist within each of these large segments that have their own defining characteristics. This complex segmentation is compounded by the fact that the vast majority of retail platforms today have erroneously been founded and built on the strategic premise that large homogeneous groups of people generally desire the same things.”

Both are worthy of a read.

 

Retail, Technology, Consolidation, and Unintended Consequences

This morning, the Seattle Times featured this article telling us that REI wage hikes for store employee announced last summer will be costing the company $24 to $25 million.  The company’s net income for its last complete year was $38.3 million.

Meanwhile, my oldest son sent me this article from Investor’s Business Daily, telling us that fast food purveyor Wendy’s will have self-service ordering kiosks in 6,000 restaurants in the second half of this year due to rising minimum wages and tight labor conditions.

I’ve been writing about the potential impact of 3D printing and other kinds of manufacturing technology for a while.  Here’s my article on the apparel manufacturing system Intel plans to introduce.

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What Will Retail Be Like in Five Years and How Will You Prosper?

That was the question asked at a meeting last week at the Agenda trade show.  The meeting was attended by various invited brands and retailers and by me.

This meeting has been going for maybe four shows now and has generally been thoughtful and productive.  That’s a welcome improvement from the larger group meetings that used to be held at ASR.  They tended to be a bit acrimonious and have limited value.  Except that I got a free breakfast.

I had to leave before the meeting ended for a dinner engagement and didn’t get a chance to put in my two cents worth.  But the topic keeps churning my brain.  Typically, that means I should write about it.

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The Impact of Demographics on the Active Outdoor Industry

I’ve just finished reading a book called The Methuselah Effect, by Patrick Cox.  As I’ve said, I often get intriguing business ideas from non-business books.  This is one of those times.  I really recommend this book.  The trouble is, it doesn’t seem to be on Amazon, which I’ve never seen before.

Anyway, the book is about advances in biotechnology and how they are going to impact health and longevity.  The first chapter title is, “Fewer Births, Longer Lives: Society’s Aging Changes Everything.”

His premise, which I found convincing, is that people are going to live longer and be more active.  But there are going to be fewer people.  He goes on to says in the first page, “From here on out, every generation will be smaller than the one before it.  After 200,000 years of population growth, mankind’s numbers are shrinking.”

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The Wallons and Skate Longboards

I want to talk about taking a long term perspective, unforeseen consequences, not learning from history and maybe confirmation bias.  A couple of things have serendipitously come across my desk as the same time that made me renew by thinking on these issues.  I seem to find my best business lessons everywhere but in business books.

As you may have read, the European Community has just spent 7 years negotiating a trade pact with Canada.  But it collapsed because the Wallons voted against it.  The Wallons represent the French speaking part of Belgium.  The other part speaks Dutch and each part has its own parliament.

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Growing Snowboard Brand Revenue; the Active Outdoor Market and Year Around Resorts

There has been much ringing of hands and gnashing of teeth around the subject of snowboard participation and what to do about it.  Studies have been done and programs implemented.  What has their impact been?  Hard to know, because we don’t know what things would look like if they hadn’t happened.

SIA reports there were 17.1 million snowboard visits to U.S. resorts during the 2004-05 season.  That number was 14.5 million in the 2014-15 season, down 15.2% over that period.  Participation during this period peaked during the 2009-10 and 2010-11 seasons at 18.9 million.

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What Does Snowboarding Need? Perhaps the Wrong Question?

I’ve almost shoveled my desk off after the always enjoyable SIA show in Denver. That shoveling process always includes reviewing the various catalogs and magazines I’ve picked up during trade show season and, as always, one of those was Transworld Business. I’d had it since Agenda, but hadn’t finished reading it.  I particularly liked Annie Fast’s article on personal progression in snowboarding.

It also had an article called “What Does Snowboarding Need?” which I stole for my title here.

Coming back from SIA, I find myself reflecting on how the industry has changed or, maybe more importantly, not changed. I’ve cautioned before on the dangers of being too incestuous as an industry and spending too much time talking to people we’ve known way too long and who are likely to validate what we already think.

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Sell the Experience, Not the Product: The Wavestorm Board

I knew about this article on the Wavestorm $100 surfboard before it ever came out. In some ways, it’s old news. Less expensive surf boards of various constructions and materials have been popping up for years now, and the Wavestorm isn’t new. I guess the genie was out of the bottle around the time Clark Foam went bell y up.

So on the one hand it’s old news. It was highlighted on Boardistan, and I kind of decided there was nothing to discuss. But it kept popping back into my consciousness, and I couldn’t bring myself to delete the link to it. I even wrote 500 words at one point and trashed it.

But here I am. It’s Sunday morning and I think I’ve figured out what’s bothering me. That is, I finally know, from a business point of view, why I care.

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Kohl’s New Retail Experiment

My family has a beach house on Long Beach Island, New Jersey.   I’ve been going there since I was a kid and still try to get back most summers. It’s where I learned to surf (I know- New Jersey surf? We work with what we’ve got).

Anyway, I was back there in September and as my wife and I headed back to the airport, Diane said, “Pull in there.” So I did. It was something called “Off Aisle” by Kohl’s and I gather this is their first store using this concept.

The store is a 30,000 square foot box with a cement floor. It’s filled mostly with racks on which apparel hangs, though they also offered some shoes, kitchen ware and bedding. Kind of like a Ross store.

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Terrain, Lifts, and Gravity: Advantages in Summer Activities; Thoughts on survival and what used to be the off season for winter resorts.

Summer has been a hot topic in resort circles for years. I’ve run a couple of snowboard companies so understand what extreme, snow dependent, seasonality means. I’ve visited resorts, written about resorts, but never worked for one. SAM, I think, thought I was the right balance of insider and outsider for this assignment.

At the beginning, this was supposed to be a straight forward article on summer business. I started with the simple idea that summer provides welcome cash flow in the off season. I figured out pretty quickly that summer activities at winter resorts is no longer an isolated topic, but part of the broader (and changing) circumstances winter resorts are facing.

That is, summer operations should be considered as one of the factors that will affect resorts’ success in the future. For some, summer ops could provide a bit of off-season cash flow; for others, it could become a major revenue source. I think there’s a group that’s going to need it to survive.

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